In December 2001, Governor Tom Ridge and Canadian Deputy Prime Minister
John Manley signed the "Smart Border" Declaration and associated
30-point action plan to enhance the security of our shared border while
facilitating the legitimate flow of people and goods. The action plan
has four pillars: the secure flow of people, the secure flow of goods,
secure infrastructure, and information sharing and coordination in the
enforcement of these objectives.

Governor Ridge and Deputy Prime Minister Manley have worked closely
with one another and with our respective government agencies to
aggressively implement the smart border action plan. While more work
remains, substantial progress has been made, enhancing both our mutual
security and cross-border commerce. A summary of the progress in each
of the action plan items follows.

#1 BIOMETRIC IDENTIFIERS

Canada and the United States have agreed to develop common
standards for the biometrics that we use and have also agreed to adopt
interoperable and compatible technology to read these biometrics. In
the interest of having cards that could be used across different modes
of travel, we have agreed to use cards that are capable of storing
multiple biometrics.

#2 PERMANENT RESIDENT CARDS

As announced in November 2001 - effective June 28, 2002, Permanent
Resident Cards are being issued to all new immigrants arriving in
Canada replacing the IMM 1000. By October 15, 2002, Canada will begin
issuing the Permanent Resident Card, for the purposes of travel, to
immigrants with permanent resident status already in Canada.

#3 SINGLE ALTERNATIVE INSPECTION SYSTEM

NEXUS is functional at Sarnia/Port Huron (since November 2000), at
Pacific Highway/Blaine and Douglas/Blaine (since June 26, 2002) and
Boundary Bay/Point Roberts (since July 29, 2002).

NEXUS will be operational at both the Detroit/Windsor and
Buffalo/Fort Erie bridges beginning in January of 2003 and at the
Detroit/Windsor tunnel by March 2003. NEXUS will be expanded to the
Queenston/Lewiston Bridge, the Rainbow Bridge and potentially the
Whirlpool Bridge by Spring 2003. NEXUS will also be expanded to all
other high-volume crossings between the two countries by the end of
2003. NEXUS enrollment centers will open on September 9 in
Detroit-Windsor and in Buffalo-Fort Erie in October 2002.

Canada and the United States are also working to implement a joint
NEXUS - Air program for air travelers. NEXUS - Air will be piloted at
Ottawa and Dorval International Airports in early 2003, and will
include a pilot and evaluation of iris recognition biometric
technology.

#4 REFUGEE/ASYLUM PROCESSING

Canada and the United States are working on an agreement to
systematically exchange information on asylum-seekers. This will help
each country identify potential security and criminality threats and
expose "forum shoppers" who seek asylum in both systems. Canada and
the United States have reached agreement on the principles of the
information exchange and will sign an agreement incorporating these
principles once all the appropriate legal steps have been taken by both
parties to exchange this sensitive information.

#5 MANAGING OF REFUGEE/ASYLUM CLAIMS

Canada and the United States have initialed the final text for a
Safe Third Agreement that will allow both countries to manage the flow
of individuals seeking to access their respective asylum systems. The
agreement, when finalized, will cover asylum claims made at land border
ports of entry.

The Agreement is bound by the principle of family re-unification in
determining whether an individual would be exempted from the
requirement of making a claim in the first country of arrival. The
Agreement also clearly identifies that individuals making a claim in
either country would not be removed to another country until a
determination of that person's claim has been made. Regulations and
operating procedures will be developed before implementation.

#6 VISA POLICY COORDINATION

Canada and the United States have agreed to enhance cooperation
between our respective Embassies overseas, which will allow our
officials to more routinely and more efficiently share information on
intelligence and specific data concerning high-risk individuals. The
two countries have also agreed to formally consult one another during
the process of reviewing a third country for the purpose of either a
visa imposition or visa exemption.

#7 AIR PRECLEARANCE

The in-transit preclearance project in Vancouver, suspended as a
result of the events of September 11, was re-instated on February 14,
2002.

In support of the preclearance program, the two countries signed
the "The Agreement on Air Transport Preclearance between The Government
of Canada and The Government of the United States of America" on
January 18, 2001. It allows for the expansion of in-transit
preclearance to other Canadian airports and also has provisions that
modernize the regime governing preclearance.

Details surrounding the preclearance program are being finalized to
allow for a formal exchange of diplomatic notes which will bring the
Preclearance Agreement into force.

#8 ADVANCE PASSENGER INFORMATION / PASSENGER NAME RECORD

Canada and the United States have agreed to share Advanced
Passenger Information and Personal Name Records on high-risk travelers
destined to either country. Canada will have an Advanced Passenger
Information system in place at Canadian airports by October 8, 2002.
The automated Canada-U.S. API/PNR data-sharing program will be in place
by Spring 2003.

#9 JOINT PASSENGER ANALYSIS UNITS

Canada and the United States have agreed to a co-location of
customs and immigration officers in Joint Passenger Analysis Units to
more intensively cooperate in identifying potentially high-risk
travelers.

Pilot joint passenger analysis units will be operational at the
Vancouver and Miami international airports by September 30, 2002,
staffed with U.S. and Canadian officials. The pilot sites will be
evaluated at the end of six months to determine the feasibility of
expanding the units to other locations.

#10 FERRY TERMINALS

We have completed a marine benchmark study to enhance Canadian and
U.S. border security at seaports aimed at improving security and
contraband interception.

#11 COMPATIBLE IMMIGRATION DATABASES

Canada and the United States have begun discussions towards
developing parallel immigration databases to facilitate regular
information exchange. The United States will study the feasibility of
duplicating Canadian intelligence gathering software at six pilot sites
by the end of 2002.

Other examples of information exchange include lookouts from our
respective databases and automating existing exchanges.

#12 IMMIGRATION OFFICERS OVERSEAS

Canada and the United States will be deploying new immigration
officers overseas to deal with document fraud, liaison with airlines
and local authorities, and work with other countries to interrupt the
flow of illegal migrants to North America.

#13 INTERNATIONAL COOPERATION

Canada and the United States have worked together to provide
technical assistance to developing countries to deal with threats to
our shared security. These cooperative efforts will continue. Joint
interdiction exercises and joint training programs will assist other
countries to combat document fraud and irregular migration. Such
assistance includes improving document integrity, providing expertise
on border controls, and joint training.

In addition, Canada and the United States conducted a joint
presentation to the European Community CIREFI (Immigration Center of
the Council of the European Union) meeting in June, regarding the
immigration items in the Smart Border Action Plan.

#14 HARMONIZED COMMERCIAL PROCESSING

Canada and the United States are now accepting applications for a
joint program for low-risk companies that will expedite the movement of
low-risk shipments in either direction across the border. The program
is known as Free and Secure Trade (FAST). The program will be available
by December 2002 at the following high-volume border crossings:

Blaine, Washington / Douglas, British Columbia

Port Huron, Michigan / Sarnia, Ontario

Detroit, Michigan / Windsor, Ontario

Buffalo, New York / Fort Erie, Ontario

Lewiston, New York / Queenston, Ontario

Champlain, New York / Lacolle, Quebec

Canada and the United States are working to align other customs
processes for all commercial shipments by 2005.

#15 CLEARANCE AWAY FROM THE BORDER

Canada and the United States are developing approaches to move
customs and immigration inspection activities away from the border to
improve security and relieve congestion where possible.

The United States and Canada have completed a joint analysis of the
operational benefits that could be achieved with the implementation of
small and large shared facilities, located in one country or the
other. With the benefits quantified, both countries have begun legal
research and analysis to find a way to make operational the shared
facilities concept.

The United States and Canada are considering innovative procedures
to improve rail enforcement activities and at the same time facilitate
the flow of rail traffic, including potential procedures such as
conducting rail enforcement activities before the border and trade
compliance processes at the destination.

#16 JOINT FACILITIES

The United States and Canada have agreed to consider the following
locations for joint or shared facilities pending the outcome of
feasibility studies:

Calais, ME / St. Stephen, NB

Easton, ME / River de Chute, NB

Monticello, ME / Bloomfield, NB

Vanceboro, ME / St. Croix, NB

Morses Line, VT / Morses Line, QC

North Troy, VT/ Highwater, QC

Walhalla, ND / Winkler, MB

Northgate, ND / Northgate, SK

Hanna, ND / Snowflake, MB

Opheim, MT / West Poplar River, SK

Nighthawk, WA / Chopaka, BC

Porthill, ID / Rykerts, BC

#17 CUSTOMS DATA

Canadian and U.S. Customs agencies have extended the scope of
information they share through:

the Cooperation Arrangement for the Exchange of Information
for the Purposes of Inquiries Related to Customs Fraud, signed in
December 2001; and

an agreement, reached by our customs agencies, on the
principles to be included in the exchange of information related to
NAFTA rules of origin. The agreement will be signed in March 2003, and
includes audit plans, audit reports, the results of advance rulings,
and origin determinations and re-determinations.

#18 CONTAINER TARGETING AT SEAPORTS

Through an innovative solution to ensure that containers can be
examined where they first arrive, regardless of their ultimate
destination in North America, Canadian and U.S. Customs agencies have
created joint targeting teams at five marine ports. In the ports of
Vancouver, Montreal and Halifax, U.S. officials aid Canadian customs
officials in identifying which containers to examine. In the ports of
Newark and Seattle-Tacoma, Canadian officials provide the same
assistance to U.S. Customs agents.

#19 INFRASTRUCTURE IMPROVEMENTS

Both governments have committed funds for border infrastructure.
Under Canada's new Border Infrastructure Fund, C$600 million will be
provided over five years for physical and technological improvements at
key border crossings. The United States Transportation Efficiency Act
for the 21st Century also funds transportation projects along U.S.
corridors and at border points along the Canada-U.S. border. Canada and
the United States are working together at key border crossings to
develop computer simulations aimed at ensuring that border
infrastructure investments are put to the most effective use. Joint
modeling is underway for the Ambassador Bridge and Pacific Highway
crossings. The two countries will now establish a binational border
modeling group to analyze border congestion on an ongoing basis.

#20 INTELLIGENT TRANSPORTATION SYSTEMS

Canada and the United States are piloting the Automatic
Identification System (AIS) on the St. Lawrence Seaway, which uses
transponder and Global Position System (GPS) technologies to allow for
more effective monitoring of ships. The Cascade Gateway Advanced
Traveler Information System (ATIS) will be installed at the Pacific
Highway and Peace Arch crossings to enhance the mobility of people and
commercial goods between Canada and the United States. We will also
invest in high-energy gamma-ray systems to support joint efforts in
screening marine containers arriving at marine ports in both
countries.

#21 CRITICAL INFRASTRUCTURE PROTECTION

Our governments have agreed on a Joint Framework for Canada-U.S.
Cooperation on Critical Infrastructure Protection and have established
a Binational Steering Committee to assess threats to our shared
critical infrastructure and ensure an ongoing, high-level focus on the
issue by both governments.

#22 AVIATION SECURITY

We have agreed to recognize each other's national standards for
security in airports and on board flights, and to coordinate measures
that are essential to protecting our citizens. With the creation of
the new federal transportation security agencies and the augmentation
of existing departments, the two governments have strengthened their
respective capacities to set regulations, review standards, and monitor
and inspect all air security services. The two governments have also
assumed direct responsibility for security standards, and will work to
identify best practices with a view to improving them.

#23 INTEGRATED BORDER AND MARINE ENFORCEMENT TEAMS

Canada and the United States have agreed to deploy one more IBET in
the Rocky Mountain region. Canada and the United States have identified
14 geographical areas for the deployment or enhancement of Integrated
Border Enforcement Teams (IBETS). IBETS are currently operational in
9 of the 14 geographic areas. IBETs will focus on criminals and
terrorists that may attempt to cross the Canada and U.S. border.

#24 JOINT ENFORCEMENT COORDINATION

The latest Canada-U.S. Cross-Border Crime Forum (CBCF) took place
on July 21-22, 2002. The participants at the CBCF reiterated the
importance of the role of Project Northstar. Since becoming aligned
with the Canada-U.S. Cross-Border Crime Forum formally in early 2001,
the role of Project Northstar as a mechanism for joint law enforcement
coordination has been significantly enhanced.

Project North Star will continue to:

identify and prioritize joint obstacles for law enforcement at
the border;

bring these obstacles to policy makers at the Canada-U.S.
Cross-Border Crime Forum for resolution,

work to increase and establish new, joint representation of
the Canadian and American law enforcement community at the binational,
regional, and local levels.

#25 INTEGRATED INTELLIGENCE

The Government of Canada has established Integrated National
Security Enforcement Teams (INSETs), which will include representatives
from federal enforcement and intelligence agencies, as well as
international law enforcement partners such as the U.S., on a
case-by-case basis. Canada has also been participating since April 9,
2002, in the U.S. Foreign Terrorist Tracking Task Force (FTTTF) in
Washington, to detect, interdict, and remove foreign terrorist
threats.

#26 FINGERPRINTS

With the development of a new Memorandum of Cooperation by October
2002, the RCMP and the FBI will implement an electronic system for the
exchange of criminal records information, including fingerprints, using
a standard communication interface.

#27 REMOVAL OF DEPORTEES

Since September 11, Canada and the United States have conducted
four joint operations resulting in 203 removals. The two countries are
committed to continuing cooperation in removing individuals to source
countries.

#28 COUNTER-TERRORISM LEGISLATION

President Bush signed anti-terrorism legislation on October 26,
2001. In Canada, the Anti-Terrorism Act came into force on December 24, 2001.

#29 FREEZING OF TERRORIST ASSETS

We have agreed to share advance information on individuals and
organizations that may be designated as terrorist in order to
coordinate the freezing of their assets. To date, Canada and the U.S.
have designated or listed over 300 individuals and organizations.

#30 JOINT TRAINING AND EXERCISES

Canada and the United States will conduct a major joint
counter-terrorism exercise in May 2003. This will provide a foundation
for the development of a more integrated program of joint training
activity.